Winebits 236: Mark West, wine labels, drug stores
• Constellation buys Mark West: Constellation, the second-biggest producer in the world, has purchased Mark West, best known for its $10 pinot noir (and long a favorite here). And why did Constellation snap up Mark West, which wasn't for sale? Because it needed a $10 pinot noir, said company officials. And why did it need a $10 pinot noir? Because that's the wine consumers are buying, which says a lot about where wine prices are going. This also speaks volumes about the massive sizes that are dominating the wine business. Mark West does 700,000 cases a year, and that wasn't enough for it compete with companies like Constellation, which does 40 million, with a grocery store brand like this. The final question — what will Constellation do to the wine's quality? If its past track record means anything, price will stay the same, but quality will decline to enable it to make its margins on a $10 wine.
• More consumer-friendly labels? Caroline Henry asks that question in Palate Press, reporting on a big-time conference in London. The answer? That it’s an increasingly popular topic, and that the industry is divided. It’s a thorough look at something we’ve talked about here a lot, though missing from the discussion was anyone from the biggest and most important wine producers. It’s one thing to hold a panel about the subject; it’s another for one of the multi-nationals who make the bulk of the world’s wine to offer their insight.
• Wine in drug stores: Walgreen’s, one of the world’s largest pharmacy chains, is testing an up-scale store concept that includes expanded wine offerings. Shanken News Daily says the 25,000-square-foot store in Chicago, about twice the size of a normal Walgreen’s, will also have sushi, a smoothie bar, and expanded fresh food. The company is looking at former Borders bookstore locations for possible expansion. If Walgreen’s makes the decision to take this idea national, it will join a variety of other retailers, including Starbucks, who see premium wine as a way to lure high-end shoppers to their stores. Whether high-end shoppers want to buy wine at Walgreen’s is another story.